IT WILL BE EXHILARATING - HARDWARE

Hardware

“I love the idea that we live in a world now where two guys can just decide to make hardware.”

John Gruber

In an article written for Wired magazine in 2010, Chris Anderson, editor-in-chief at Wired, claimed that “atoms are the new bits.” In his words:

Transformative change happens when industries democratize, when they’re ripped from the sole domain of companies, governments, and other institutions and handed over to regular folks. The Internet democratized publishing, broadcasting, and communications, and the consequence was a massive increase in the range of both participation and participants in everything digital—the long tail of bits.

Now the same is happening to manufacturing—the long tail of things.

We’ve been fortunate enough to experience this first hand. Services and technologies that did not even exist five years ago are lowering the barrier for anyone to start making hardware, and this trend will continue as technologies proliferate and decrease in cost. Manufacturing a physical object will never be quite as easy as starting a blog or posting a video to YouTube, but it’s getting closer.

Prototyping

One of the key advancements that made both the Glif and Cosmonaut projects possible is easily accessible and cheap 3D printing. In the crudest possible terms, 3D printing is an additive manufacturing technique that takes a digital 3D model and “prints” thin layers of plastic on top of one another until you end up with a solid plastic part. Until just recently, the only option industrial designers had was to hire someone to make a cast or carve of their design, which of course was very time-consuming and expensive. Now, with companies like Shapeways and Ponoko, designers can order 3D prints over the internet and have them arrive in 1–2 weeks. Amazing.

We went through about 10 iterations of the Glif before we settled on the final design. Each iteration was 3D printed, and we were able to learn a tremendous amount about what was and wasn’t working with a design by being able to hold the physical object in our hands, and test the fit on an iPhone.

Some of the various 3D printed prototypes for the Glif.

Beyond the 3D printing tools we’ve used to design our products, indie entrepreneurs have a whole host of prototyping tools that have only recently become available. Arduino, the open-sourced electronics platform, enables tinkerers to prototype their ideas with motors, sensors, computer chips and screens. Websites like eMachineShop give us access to professional-level machine shops so we can create custom metal parts from our desks.

Basically, a high school kid in the middle of nowhere can now make almost anything with just his or her imagination, the internet, and a few bucks.

Finding a Manufacturer

When we reached our funding goal for our Glif Kickstarter campaign in one day, we knew the scale of our project was growing much bigger than we expected. Our next order of business was to find a manufacturer that could handle that quantity. We were initially planning on using a company we found through Google called Protomold, which specializes in low run injection molding. When we realized the quantities were going to be much higher than we were anticipating, and higher than Protomold could accommodate, we had to start looking elsewhere.

We wish we had a silver bullet or magic piece of advice for finding the perfect manufacturer for your product, but it’s really pretty boring: lots of Googling and lots of cold calls. For the Glif we called dozens of manufacturers, and ended up getting quotes from six of them. We ultimately chose Premier Source, a small company located in Brookings, South Dakota, because they understood what we were after, and shared our enthusiasm for the project.

If you are planning on running a Kickstarter campaign for a physical object that needs to be manufactured, we strongly advise you to speak with, and ideally select, a manufacturer before you launch the campaign. It is of upmost importance to make sure your concept can even be manufactured in a cost effective way, and some design tweaks may need to occur before you launch. This was something we learned the hard way with the Cosmonaut campaign. Although we did have a manufacturer selected and a build process outlined, it ended up being far more complicated then we had bargained for, and we ultimately had to hire three separate vendors to get it made.

What if you have no idea what manufacturing process you should be using? There are a lot of great resources out there to familiarize yourself with various processes. Making It: Manufacturing Techniques for Product Design, by Christ Lefteri, is an excellent place to start and describes common production methods in straightforward language.

Made in the USA

Want to help create jobs in a country that seems to be forever lingering in a recession? Want to help bring that country back to its hey day as a manufacturing power? Make your stuff in America.

There are many more intelligent and well informed people who can speak to the advantages of manufacturing overseas, but in our experience these are shrinking, and manufacturing stateside offers some significant advantages, especially for a company as small as ours. Just because Apple makes their stuff in Shenzen doesn’t mean we have to.

For starters, it has been a boon to be able to easily visit our manufacturers in South Dakota. We love being directly involved with the manufacturing process, and this is especially easy when the plant is located in the States. Of course it is not impossible to travel to China, but it is certainly more difficult and expensive.

As two young guys with no manufacturing experience, we were susceptible to all kinds of rookie mistakes, but thankfully Premier Source was ready and willing to guide us through the whole process. They immediately understood our objectives and design goals, and were able to help us make smart design decisions that would improve the manufacturing side of things. We doubt we would have gotten that kind of attention if we tried to outsource overseas.

Perhaps most importantly, it feels right. There is no way we could be doing what we are doing if not for the opportunities presented to us by living in this country. Sure, it might cost a little more to manufacture in America, but we think it’s more than worth it.

Obviously, for huge companies like Apple, manufacturing anywhere other than Asia simply doesn’t make financial sense. But what about for smaller companies, like ours? For the answer to that, we turn to our friends Che-Wei Wang and Taylor Levy of CW&T, a duo that launched their awesome and rugged Pen Type-A on Kickstarter, and raised $281,989. They manufactured their product in China, so we decided to ask them about their experience:

Our Kickstarter campaign ended mid-August 2012. Like Studio Neat with the Glif, we were blown away by the amount of pre-orders we received from backers. Our original goal was to make 50 pens and we ended up with over 5,500 pre-orders.

We chose to manufacture Pen Type-A at the same factory in China where our prototypes were made. We were happy with them, and assumed that if they could make our prototypes, then they could make several thousand. We often work with China when we make prototypes, but we had never tested a medium scale fabrication run. We were curious to see if it was possible.

Over the course of a year, we worked with and fired two different Chinese factories. Early on, they both told us that they could meet the specifications and manufacture our pens without a problem. We fired the first factory after a week. To make a very long story short, they simply were not equipped with the machines or expertise required to make the pens. We learned a lot, but we were happy to cut our losses. Working with the second factory was a much different experience. It was owned and operated by two engineers, one American and the other Chinese, who were friends from a prominent US business school. This factory actually managed to fulfill most of our order, but only after problems with quality control, meeting specifications, price increases, significant delays, misleading us about how the pens were being made, lawyers getting involved and oh! we had to remake 30% of one of the parts in America. It was a grueling process.

Pen Type-A requires 4 parts to be precision machined out of stainless steel. It’s not the easiest material to work with, but it’s certainly not unusual. One of the biggest challenges of working in China is that anything that can be made by hand, is made by hand. Even when we were assured parts were being made on a CNC (computer numerically controlled) machine, we found plenty of inconsistencies as a result of manual labor.

Another big challenge was communication. Language wasn’t the problem, but communicating how crucial it was to have products that met our specifications precisely was incredibly difficult. Our fabricator would often qualify substandard parts as “good enough” in an attempt to sidestep specifications. To give China the benefit of the doubt, we are extremely nit-picky. And I think it’s fair to assume that if you are reading this book, you probably are too. Our first priority is to be proud of what we’re making, and we demand quality that meets our expectations. Good manufacturers would never sidestep specifications. If something turns out to be harder than expected they will suggest alternatives that often improve the design while solving manufacturing issues.

Small studios should take a long hard look at where they have stuff made. Sure, plenty of garment and electronics brands pull off manufacturing in China on-time and in-budget with great quality. But, unlike a giant corporation, we don’t have the leverage of multi-million dollar contracts. As a two-person team, we bear the full responsibility of delivering products to our customers. We are the customer support hotline, R&D, PR, accounting, etc. The last thing we need is extra demands clouding our super valuable creative time.

We now work with a manufacturer in Vermont that shares our attention to detail and has standards of quality that surpass any factory we’ve ever seen. We visit them often to see how they operate and to talk to machinists on the floor, face to face. There’s nothing more reassuring than a machinist who tells us how uneasy it makes him when a part comes out measuring 1 thousandth of an inch off when the specifications show a tolerance of 5 thousandths (that’s 0.001” vs 0.005”). Quality is ensured by the culture of the entire operation, not just a quality control department that has to sift through thousands of parts to pick out and reject bad parts.

We can only speak from our experience, but for us, the benefits of working with a domestic manufacturer greatly outweigh the benefits of manufacturing in China. We say that now, and you’ll probably hear it over and over again. In the face of comparing quotes that are a fraction of another, it might be hard to swallow, we know.

Instead of debating the pros and cons, our advice is to test it for yourself. Pick a few US shops and a few overseas. Have each of them make a small sample production. Budget that into your project, and evaluate the results for yourself. An important thing we learned is that no two manufacturing projects are ever the same. Regardless of a fabricator’s experience, surprises are inevitable.

Manufacturing is hard. There are no shortcuts. Regardless of where something is made, you get what you pay for. No magic, no secrets, and always lots of surprises.

Many of CW&T’s insights apply beyond just manufacturing in China. It is always a good idea to seek out several options, for anything, in order to make an informed decision. And of course, as they said, you get what you pay for.

Packaging

If you are in the game of making and selling hardware products, packaging is an integral component. The packaging is a way to make that all-important first impression on the customer, a chance to surprise and delight them.

Like everything we do, we strive for simplicity in our packaging. We are in a unique position, selling essentially online only, so we don’t need to make our packaging “retail friendly.” There are other considerations to keep in mind when something is being shipped through the mail, certainly, but it is nice to not have to worry about how it will look when sitting on a store shelf.

Coming up with packaging ideas and prototyping them is lots of fun, at least for us. It harkens back to our model making days in architecture school. Like architectural models, we find it most productive to grab an Exacto knife and some cardboard (we use cereal boxes) and dig in. It’s also fun to seek out different types of packaging for inspiration.

Packaging for the Glif, Glif+ and Cosmonaut.

For the Glif, we went as minimal as possible: black ink printed on kraft board, with a simple die cut to house the Glif. The shape of the Glif allowed it to stay in place, suspended in the middle of the card, without any additional reinforcement needed.

When we expanded the Glif line to include the Glif+, we wanted to try something a little cheeky. In the spirit of “using every bit of the buffalo,” we designed the packaging to turn into a mini tripod (technically a bipod). It’s not particularly practical, but could be used in a pinch.

Our most well received packaging, by far, was for the Cosmonaut. It’s our most traditional package, a simple box, tray, and sleeve, but when you slide the box out of the sleeve it reveals the Cosmonaut, with little rocket fins printed on the side of the tray. Ready for take off.

All of our packaging is printed on recyclable kraft material. Again, because it is not meant for a retail space, we have an easier time finding a more eco-friendly solution.

Finding a printer was a process similar to that of finding a manufacturer; we used Google to do our research. Printers are usually happy to send various packaging samples; take advantage of this to evaluate what their work is like. We ended up going with Keystone Folding Box Co., located in New Jersey, and they’ve been great.

Order Fulfillment

With our pre-launch goal of selling 500 Glifs, we had planned to spend a weekend or two stuffing envelopes, and mailing everything ourselves with a few trips to the post office. When our project blew up beyond our expectations, shit got real.

We didn’t know anything about order fulfillment services, and we had to learn, quickly, if we wanted any chance of getting the Glifs into backers’ hands before the holidays. We wanted the Glif to be neatly tucked underneath the Christmas tree alongside Nintendo 64s and Super Soakers (wait, what year is it?).

First, let’s take a step back. What is an “order fulfillment service?” Remember watching late night TV ads where the product would cost X dollars plus Shipping and Handling? Order fulfillment is the Handling part of that equation. You send a fulfillment company your inventory, bulk packed from your manufacturer. They stock your inventory, and when an order comes in (typically from your ecommerce site) they process it, pack it up, and ship it to the customer.

If you are making and selling a physical product that needs to be shipped to a customer, using an order fulfillment service is not necessarily a given. Threadless, the popular crowd voting t-shirt company, began by fulfilling orders themselves, and as they grew, so did their warehouse space. Tattly, the designy temporary tattoo company founded by Tina Roth Eisenberg, fulfills its orders in-house as well. If you have just succeeded in getting funding for your Kickstarter campaign, and you have a relatively modest number of backers, fulfilling the orders yourself will be the most cost effective option.

However, in some circumstances, hiring a fulfillment service is necessary, and awesome. It is one of the chief reasons the two of us are still the only two employees of Studio Neat. We have warehouses stocking our inventory in Los Angeles, Philadelphia, and the United Kingdom. Orders made at studioneat.com are sent directly to our fulfillment center, and they take care of the “Shipping and Handling.” At this point, it’s a fairly hands-off process for us.

We decided to use Shipwire, and they’ve been a fantastic partner. They have six warehouses across the world (we stock inventory in three of them), which makes it easy to grow without inordinate complication and headache. Depending on the quantity shipped per month, Shipwire takes around $2 per item shipped plus the cost of the packing materials and shipping. This is a pretty standard rate for fulfillment services. They also charge a small monthly fee for renting space for your inventory in their warehouse.

One operational problem that continues to vex us is maintaining proper inventory levels. Tim Cooks, we are not. Ideally, the minimum amount of inventory should be maintained to satisfy demand, but this is tricky when unexpected spikes and lulls occur. Our current method is to build up several months of inventory, and hope the rug doesn’t get pulled out from under us.

Selling Online

99% percent of our business is selling products online. People are often surprised when they learn that we don’t pursue physical retail opportunities. This may seem obvious, but we feel the population likely to seek products like ours has reached a point where they are totally comfortable shopping online, and it is clearly possible for a company to exist with an online-only presence.

We use Shopify as our ecommerce platform of choice. It’s secure, reliable, and interfaces beautifully with Shipwire, our order fulfillment service. It is also fully customizable; our storefront is a unique, non-templated design. Shopify also has several options for payment gateways. We use Braintree (for credit cards) and Paypal, but there are many more options as well.

Aside from Shopify, we also sell our products on Amazon.com. This has been, in a word, awesome. Amazon functions like a combination of Shopify and Shipwire in that they act as the ecommerce platform and the fulfillment company. Creating a listing on Amazon is straightforward, and they make it easy to send inventory to them by providing prepaid, printable UPS labels. We make slightly less money on a product sold on Amazon versus on our website, but the convenience of having our products on Amazon (for us and the customer) makes it worth it. Amazon also handles the customer service for items sold on their site, so that helps defray the cost as well.

Wholesale

When our manufacturer packages our inventory, we have them pack 50 items into a smallish box, and then pack four of those smallish boxes into a larger box. The reason we take this extra step is simple: wholesale.

Wholesale is a way for people who have stores of their own (either online or retail) to sell our products. Typically, those interested in our products have photography, gadget, or Apple centric stores.

We offer all of our products at wholesale prices to anyone interested. All it is, essentially, is a discount for purchasing a large quantity of our stuff. We pack the items in the smaller boxes of 50, which is a reasonable starting quantity for resellers.

It sounds fairly simple, but be wary, as selling wholesale can add a lot of complication to your business. Resellers will sometimes ask for exclusivity contracts (exclusive rights to sell in a specific country or region), drop ship arrangements (they make the sale but we are responsible for shipping the order), or net 30 payment terms (a 30 day window to make payment after the order has been shipped). While none of these are unreasonable requests, it can become a chore to maintain those relationships.

We ultimately decided to streamline our terms. Essentially, when you buy wholesale from us, you are simply getting a discount for purchasing a large quantity at once. We don’t offer exclusivity, and you have to pay for the order before it ships, just as any customer would. Some resellers could balk at those terms, and we may lose some resellers as a result, but if the end result is a dramatically simplified way of maintaining that aspect of our business, the trade off is worth it.

Retail

We’ve gone back and forth when it comes to getting our products into brick and mortar stores. On one hand, it would be quite satisfying to see the Glif in Apple Stores, side by side with the product that inspired its design. On the other hand, we’ve heard that retail can be an absolute bitch, with slim margins, and lots of people in the middle taking small bites out of your profit every step along the way. Additionally, the retail store will often have strict guidelines about packaging, pricing, etc. And some stores will heap all of the risk on to you, meaning, if your product doesn’t sell, you are forced to buy it back from them. Sounds like a great deal, eh?

There seem to be two games at play. With retail, you have low margins, less control over the presentation of the product, and little direct customer interaction, but you have the potential to make it up with quantity sold. By selling direct online, you cut out all middlemen, have complete control over the product, and get to interact directly with your customers. You may not sell as well, but the margins will be much higher. For us, the choice was easy. We started indie, so we’ve decided to stay that way.

For some products, pursuing retail makes a lot of sense. If you design an innovative new kitchen utensil, for example, you might have much greater success if shoppers “discover” it in the right retail store, rather than hoping they stumble upon it online. Furthermore, you may simply have a product that is difficult to ship through the mail, or something that needs to be touched or felt to be fully appreciated. We are fortunate to have products ideally suited for an online audience, but this is not the case for everyone.